Save money on your home insurance with these smart tips

By Andrea Duchon

Reducing the amount of money you spend on home insurance can make a big impact on your wallet. Here are seven proven ways to help lower your home insurance payments.

Yahoo! Homes/Photo: Thinkstock

Are you interested in a purchasing a home, but concerned about the hefty home insurance bill that comes along with it? Or are you simply looking to cut costs where possible?

No matter what situation you're in, reducing the amount of money you spend on home insurance can make a big impact on your wallet.

To help, we've pulled together seven proven ways to lower your home insurance payments.

#1: Ditch the Dangerous Toys

Certain items like trampolines and swimming pools can seriously increase your insurance premiums, so you should think twice before purchasing them, says LiveWatch Home Security Systems CEO, Brad Morehead.

"Insurance companies know that trampolines are a huge risk, so premiums reflect the increased chance of injury because trampolines are one of the leading causes of emergency room trips for children," Morehead says.

In fact, nearly 68,000 children under 14 were treated in the ER for trampoline-related injuries in 2011 alone, according to the U.S. Consumer Product Safety Commission.

If you already have a pool or a trampoline, Morehead says there are still ways to reduce costs:

"Make sure to use proper protective gear around a trampoline and securely fence in a pool, which is a requirement for many local building codes, anyway. Definitely let your insurance agent know if you implement some of these safety items or if you end up getting rid of a trampoline or pool as either move could lower your insurance costs," Morehead advises.

 

#2: Put Some Thought into Your Furry Friends

Did you know that the type of dog you adopt could influence your insurance premiums? It's true, says Morehead.

"Based on the actuarial data, certain breeds are deemed "aggressive" breeds and can cause your premium to go up. If your pup is a Rottweiler, Pit Bull, Doberman, German Shepherd, Akita, et al, or even a Great Dane (sorry Scooby-Doo), your insurance premium can be higher, even if your dog is a cute little puppy and hasn't ever harmed a soul," he notes.

Essentially, insurance companies consider homeowners with certain dog breeds to be more of a risk, and will charge them a higher premium as a result.

And their cause for concern is warranted, as "Dog bites accounted for more than one-third of all homeowners insurance liability claims paid out in 2012, costing over $489 million," according to the Insurance Information Institute's website (III).

#3: Insure Your Home, Not the Land

It may be standard practice to insure the land that your home is built on, but Andrew Schrage, co-owner of the personal finance website, moneycrashers.com, says doing so could be money misspent.

"There is no reason to insure the land that your home sits on because the majority of damages involved in an insurance claim come from inside the home, and not the land," Schrage says. "You can save a lot by only insuring your home and not the surrounding land."

Schrage says the amount you can save will vary greatly based on the size of the lot and the area your home is in. You should ask your insurance provider to break down the specific costs for you.

#4: Secure Your Home

By protecting the most important asset in a home insurance situation - your home - you can lower your costs pretty easily.

In fact, "Most insurance companies provide 2 percent to 15 percent discounts for devices that make a home safer - dead-bolt locks, window grates, bars and smoke/fire/burglar alarms," notes the III.

And this makes a lot of sense, says Morehead.

"Obviously if you have necessary precautions in place when disaster strikes, your damage may be less than someone without those protections. And less damage means few claims to the insurance company," Morehead explains.

#5: Start or Partake in a Neighborhood Watch

Starting a neighborhood watch can actually reduce your home insurance costs, says Morehead.

"Neighborhood Watch is a catalyst for lower insurance rates because the group's presence is proven to lower crime rates," he says. But don't think that just putting up a fancy sign will do the trick.

"While insurance companies do not give discounts for the watch group itself, when these organizations actually help lower crime rates, they can save homeowners money in two ways," explains Morehead. "Insurance companies use crime rates as part of the algorithm to determine rates: When crime rates decrease, so too do homeowners' insurance costs."

 

#6: Make Smart Renovations

If you're remodeling your home, think about renovations that can make your home more disaster-resistant. Doing so could reduce your home insurance payments.

In fact, "You may be able to save on your premiums by adding storm shutters and shatter-proof glass, reinforcing your roof or buying stronger roofing materials," notes the III.

Another way to make you and your home less of risk to insurers is to update your heating, plumbing, and electrical systems, according to the III. By replacing these old systems, you'll lower the risk of fire and water damage to your home and in effect, help lower your premium.

Of course, discounts for specific renovations will vary depending on the insurer, so make sure to shop around to see what kind of discounts are available.

#7: Make a Move

This tip isn't for everyone, and certainly isn't as easy as installing a security system. However, if you're thinking about moving or are currently looking for a home, did you know that the proximity of your home to other facilities could have a big impact on your insurance premium?

Surprisingly, homes more than five miles away from a fire department can come with a premium that is 20 percent or  higher, says Schrage. But he notes that by moving closer to the firehouse, you can drastically reduce your home insurance costs.

"If you live closer to a firehouse, then emergency services can respond quicker and have a chance to limit the damage," says Schrage.

The geographical area surrounding your home can also play a big role in how much your insurance is.

"Homes located near forests - usually in the western portion of the country - are also more susceptible to damage from a wildfire, thereby making them more costly to insure," says Schrage. "Similarly, homes located near the coast - generally the East Coast - are more prone to windstorms and hurricanes, and therefore may come with a separate additional deductible and a higher premium."